President Donald Trump said on Sunday, September 27, that he expects U.S. officials to continue negotiations with Iranian counterparts this week. The statement followed his rejection on Saturday of a seven-day ceasefire proposal from Tehran, which sought the immediate reopening of the Strait of Hormuz. Trump told Axios in a phone interview that while Iran wants to reach an agreement, the current terms are unacceptable, stating, "They overplayed their hand."
The conflict between the U.S. and Iran reached its seven-month mark on Monday, September 28. During this period, the Iranian military has restricted shipping in the Strait of Hormuz, a critical waterway for global oil transit. Consequently, Brent crude was trading at more than $107 per barrel on Monday. U.S. Ambassador to the United Nations Mike Waltz stated Sunday that the Iranian proposal requested "everything up front" for a short-term truce, a move he characterized as a miscalculation of U.S. priorities.
Iranian Foreign Minister Abbas Araghchi said on Sunday that his government had not yet been formally notified of the U.S. rejection via mediators. Speaking to NBC, Araghchi stated that Iran is "ready to negotiate" but also "ready to face any challenge," including the resumption of hostilities. Meanwhile, on Sunday, the Iranian Revolutionary Guard Corps (IRGC) announced it had captured a Remus 600 U.S. autonomous underwater drone in the Strait of Hormuz, alleging it was being used for espionage.
The economic impact of the war has prompted Treasury Secretary Scott Bessent to lead "Operation Economic Outcast," an effort to isolate Iran from the global financial system. According to Bessent, several countries have recently implemented new restrictions: the United Arab Emirates blocked transactions with Iran's Bank Melli, and Turkey revoked the license of Bank Mellat. Additionally, Oman, Turkey, and the UAE have halted or restricted flights from Iranian airlines.
The scale of the energy crisis is further reflected in the depletion of the Strategic Petroleum Reserve (SPR), which is currently at a 40-year low after the U.S. released 130 million barrels to stabilize markets. Globally, 32 countries have released 400 million barrels from their reserves since March 2026. If the blockade continues, analysts suggest that limited remaining reserves and damage to alternative routes—such as the Saudi East-West pipeline, which was attacked in mid-September—could lead to fuel rationing or 1970s-style shortages at gas stations.
Future policy and market stability remain tied to the outcome of these negotiations and the upcoming U.S. midterm elections in November. Rep. Jim Himes (D-CT) noted that diesel prices could potentially reach $8 per gallon if further disruptions occur, influencing voter sentiment. While Trump stated he expects talks to resume this week, he has not ruled out further military strikes. The next steps depend on whether mediators convey a new Iranian position and if diplomatic efforts can reopen the Strait of Hormuz before the winter heating season begins.